12 Best Renters Insurance Companies of 2020

My wife and I didn’t open our first renters insurance policy until we were well into our 20s, when we began accumulating possessions other than Craigslist furniture and hand-me-down electronics.

As much as it pains this personal finance writer to say, we bought into one of the myths about renters insurance: that it was only worthwhile for older, better-off renters with expensive furniture or art collections. Our landlord never asked us to obtain renters insurance, and my wife was too busy with school to second-guess my conclusion, so we left it at that.

Thankfully, no ill ever came of our oversight. But in hindsight, we were playing fast and loose without basic renters liability coverage. On our creaky front steps, one false step by a party guest with a lawyer in the family could have permanently altered our household’s financial trajectory.

Don’t be like us. Peace of mind is priceless, and it costs less than you may think to protect yourself from potential financial ruin. And you have no shortage of options to choose from.

Best Renters Insurance Companies

No two insurers are alike, so before choosing a policy, carefully consider each company’s relative strengths and weaknesses. Pay special attention to feedback from third-party rating agencies, such as A.M. Best and J.D. Power. Their word matters more than a thousand semi-anonymous customer reviews.

1. Erie Insurance

A.M. Best Financial Strength Rating: A+ (Superior)
J.D. Power Overall Satisfaction Rating: 865 out of 1,000 points
Notable For: Policy bundle discounts, smooth claims process

If you haven’t heard of Erie Insurance, you’re not alone. With local agents in just about a dozen states, it’s the smallest renters insurance operation on this list.

But whatever Erie lacks in size and name recognition, it makes up in excellent customer service, generous bundle discounts, and very reasonable prices. Erie ranks second for overall customer satisfaction in J.D. Power’s 2020 home insurance study, just below Lemonade.

Erie is renowned for deeply discounted policy bundles. Combine your renters policy with auto insurance, life insurance, or other policies, and you could qualify for premium discounts of 30% or more.

Erie’s agent-centric business model is a bit old-fashioned. Before requesting a quote, you’ll need to select a local agent, though you’re free to shop around for agents and don’t have to stick with your original choice. Erie has more than 12,000 local agents, an average of 1,000 per state served.

If you’re not big on the whole human touch thing, Erie may not be your cup of tea. That said, the company earns high marks for customer service, so it must be doing something right. And for renters who also need to insure vehicles, its auto-home bundle discounts pack a punch.

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2. Lemonade

A.M. Best Financial Strength Rating: Not yet rated, but Demotech gives Lemonade an “A” (Exceptional)
J.D. Power Overall Satisfaction Rating: Top honors in J.D. Power’s 2020 home insurance study (866 out of 1,000 points)
Notable For: User-friendly policy creation and claims, reasonable pricing on basic policies

Lemonade is a lean, nimble renters and home insurance provider that boasts speedy onboarding and fantastic pricing for basic renters coverage. Although it hasn’t been around long enough to earn ratings from A.M. Best or J.D. Power, Lemonade gets high marks from current customers and appears financially sound, per Demotech.

Lemonade stands out for low, transparent pricing and rapid claims payment – claims take as little as three minutes to pay out. Basic policies start as low as $5 per month, though your actual premium depends on what you choose to include in your policy.

Lemonade operates as a Public Benefit Corporation and certified B-Corp, meaning it manages a “triple bottom line”: people, planet, and profit. Through its Giveback program, the company gives away up to 40% of unclaimed funds to causes policyholders select. In 2018, that amounted to over $150,000.

Lemonade isn’t available everywhere, but it does serve seven of the United States’ eight most populous states and rolls out new territories regularly. Check its availability map to see if Lemonade serves your area.

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3. USAA

A.M. Best Financial Strength Rating: A++ (Superior)
J.D. Power Overall Satisfaction Rating: Not included in J.D. Power’s 2020 official rankings, but regularly rates at or near the top of its list
Notable For: Excellent customer service, comprehensive coverages

USAA is another highly rated renters insurance provider that’s not for everyone. Unlike Erie, USAA has coast-to-coast coverage, but membership is restricted to active, retired, and honorably separated service members and their eligible family members (generally, spouses and children).

All told, less than 5% of the U.S. population is eligible for USAA membership, but it’s a great deal for those who qualify. For as little as $12 per month, USAA’s basic renters insurance policy includes flood insurance and allows renters to add earthquake coverage at no additional charge. That’s great news for renters in floodplains and tectonically active areas.

USAA’s personal property coverage is portable, meaning it travels with you wherever you go – a key consideration for career service members for whom frequent relocation is a fact of life. Replacement cost coverage ensures you’ll receive the full like-new value of stolen or damaged items, not a depreciated reimbursement that amounts to pennies on the dollar.

One of my close friends is a USAA lifer and can’t say enough good things about the member experience, particularly on the customer service side.

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4. State Farm Insurance

A.M. Best Financial Strength Rating: A++ (Superior)
J.D. Power Overall Satisfaction Rating: 836 out of 1,000 points
Notable For: Generous standard coverage, reasonable pricing for add-on coverage, extensive bundle discounts

State Farm offers reasonably priced standard renters insurance coverage and a host of add-ons, such as special hazard coverage and valuable personal property, for a modest price. Unlike USAA, State Farm doesn’t include flood or earthquake coverage in its standard policies. Adding them isn’t a particularly onerous process, but it could significantly increase your total out-of-pocket premium.

As a full-service insurer, State Farm is big on bundle discounts. According to a 2018 State Farm survey, the average new customer saves $854 annually when they switch to State Farm and bundle multiple policies.

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5. Allstate

A.M. Best Financial Strength Rating: A+ (Superior)
J.D. Power Overall Satisfaction Rating: 841 out of 1,000 points
Notable For: Discounts galore, lots of options for high-end renters

Allstate is a full-service insurer known for generous single-policy and bundle discounts and a vast network of local agents. Unlike Erie Insurance, Allstate doesn’t require you to go through an agent; you can request a quote and purchase a policy online with minimal human interaction. But it’s nice to have the option of working with an experienced agent, particularly if you have lots of high-value items to insure.

Speaking of high-value items, Allstate really shines when it comes to scheduled personal property, or your itemized list of insured valuables. Consider identity theft restoration coverage too; it could be a potential life- and budget-saver. Allstate encourages dog owners to purchase umbrella insurance, which provides additional liability coverage, to ensure total peace of mind in multi-tenant buildings and urban environments.

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6. Nationwide

A.M. Best Financial Strength Rating: A+ (Superior)
J.D. Power Overall Satisfaction Rating: 831 out of 1,000 points
Notable For: Lots of policy add-ons, generous replacement coverage

Nationwide offers a dizzying array of policy add-ons for renters looking to build custom policies. Meanwhile, its standard coverages go beyond some of the competition. Unlike competitors that ask renters to pay extra for identity theft protection, Nationwide’s standard policies include protection for unauthorized credit card charges. Though zero-liability fraud protection is a standard feature of premium credit cards, some entry-level cards and cards for credit-impaired users don’t include it.

Nationwide’s optional Brand New Belongings add-on is a potentially valuable inclusion for policyholders willing to pay higher premiums for peace of mind. It offers non-depreciated reimbursement for stolen or damaged items, making it likely to pay for itself after a single burglary or covered loss.

Nationwide’s protection isn’t all-encompassing, though. You’ll need to pay extra to make its personal property protections portable, insure high-value scheduled items, and protect against damage due to sewer backups. On the bright side, you can request a quote and choose a policy online or by speaking with an agent.

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7. Farmers Insurance

A.M. Best Financial Strength Rating: A (Excellent)
J.D. Power Overall Satisfaction Rating: 839 out of 1,000 points
Notable For: Lots of deductible options, great customer service

Farmers Insurance provides reasonably priced basic renters coverage that’s easy to customize with higher or lower deductibles. Certain professionals, including firefighters and teachers, may qualify for premium discounts not available to the general public. Households that have been smoke-free for at least two years automatically qualify for discounts as well, even if they don’t bundle health or life insurance with their home policy.

On the downside, personal property protection is sparse, with individual items valued at $500 or more requiring scheduled protection not included in the base premium. If you’re worried about perils not covered by the typical renters insurance policy, you’ll need to add optional protections, such as Identity Shield theft protection and umbrella coverage. Unlike some competitors, Farmers doesn’t go the extra mile.

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8. Liberty Mutual

A.M. Best Financial Strength Rating: A (Excellent)
J.D. Power Overall Satisfaction Rating: 825 out of 1,000 points
Notable For: Great bundle discounts, smooth claims process

As a full-service insurer, Liberty Mutual is a great choice for renters looking to capitalize on bundle discounts. I’ve personally saved hundreds annually by switching to Liberty and bundling renters – and later homeowners – insurance with my auto policy. I can also attest to the smoothness of Liberty’s claims process; they’re by far the easiest insurer I’ve ever dealt with.

That’s not to say that Liberty Mutual is perfect. It’s most cost-effective for customers who don’t file claims; its claims-free discount requires policyholders to go a full five years without any claims activity. That’s not ideal, and may not be possible, for renters whose daily lives involve higher-than-average risk to life and limb.

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9. Travelers Insurance

A.M. Best Financial Strength Rating: A++ (Superior)
J.D. Power Overall Satisfaction Rating: 807 out of 1,000 points
Notable For: Great loss of use coverage

Travelers Insurance offers generous standard policies that include portable personal property protection and above-average loss of use coverage – reimbursement if your dwelling is rendered uninhabitable by fire, smoke, vandalism, or other covered peril. Unfortunately, protection for high-value items, such as jewelry, isn’t built into the standard Travelers policy; you’ll need to pay more to add it.

Like Liberty Mutual, Travelers rewards policyholders who avoid filing claims for years on end. Unlike Liberty, Travelers’ bundle discount is pretty anemic; the company promises no more than 5% savings to renters who bundle home and auto.

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10. MetLife

A.M. Best Financial Strength Rating: A+ (Superior)
J.D. Power Overall Satisfaction Rating: Not ranked in 2020
Notable For: Lots of packages for high-end renters

MetLife is ideal for affluent renters and those seeking more protection than the average basic renters policy provides. Replacement cost coverage is a standard inclusion; you never have to worry about pennies-on-the-dollar depreciated reimbursements here. Standard liability protection starts at $100,000 per policy, providing ample coverage for all but the costliest liability claims – and MetLife has reasonably priced umbrella insurance for that. In some states, you can customize non-itemized personal property coverage, up to $15,000 in total value.

MetLife offers professional association and employer discounts, so be sure to enter yours when prompted during the quote-building process. Bundle and claim-free discounts may also apply.

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11. Amica

A.M. Best Financial Strength Rating: A+ (Superior)
J.D. Power Overall Satisfaction Rating: Not ranked in 2020
Notable For: Smooth claims process, high-touch customer service

Amica delivers reasonably priced, customer-friendly renters insurance with a smile. The company’s policies start at $4 per week, or less than $20 per month, though your actual premium will vary based on where you live, what you’re covering, and which optional add-ons you choose.

Despite its reputation for high-touch customer service, Amica has a super-efficient policy generation workflow that lets you create a working policy in a matter of minutes. Bundlers save up to 7% on renters and auto policy premiums – not exactly the best in the business, but nothing to sneeze at, either. They save up to 15% on combined renters, auto, life, and umbrella policies. The three-year claim-free window is shorter than some competitors’, and new policyholders start earning loyalty discounts after just two years of continuous service.

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12. PolicyGenius

A.M. Best Financial Strength Rating: N/A
J.D. Power Overall Satisfaction Rating: N/A
Notable For: Quickly sourcing multiple renters insurance quotes that fit your needs and budget.

The quote aggregator PolicyGenius doesn’t issue policies of its own, but it’s worth including on this list. PolicyGenius walks you through the policy-building process, helping you save time by selecting from a range of coverages, deductibles, and add-ons and receiving quotes from multiple providers. You’ll get a slew of renters insurance offers in an easy-to-understand format, making it painless to select the most cost-effective policy without sifting through emails or spending hours on the phone.

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Final Word

It’s basically impossible to purchase a home on credit without also opening a homeowners insurance policy. But your landlord or property management company doesn’t have hundreds of thousands of dollars riding on your unit’s continued good repair. They have their own insurance policy on the premises, so they might not require tenants to carry renters insurance.

However, even if your landlord doesn’t require it, there’s still a strong case to be made for purchasing a policy. Renters insurance exists to protect your financial interests after a covered event, such as a burglar making off with your record collection or a guest breaking their ankle in a freak accident on the premises. In circumstances like these, renters insurance could mean the difference between a manageable loss and a major out-of-pocket expense that sets your finances back by months or years.

Published at Thu, 03 Dec 2020 15:00:24 +0000